BELGIUM - KBC, the banking and insurance group, is in the process of establishing a new international pension scheme for its expatriate employees, which could eventually become pan-European.

Edwin Meysmans, managing director of the €900m Pensioenfonds KBC, said the new scheme would be set up separately under the new Organisation for Financing Pensions (OFP) regime and would be designed to take account of the specific circumstances of expat employees.

He said there are now around 160-170 expat employees as KBC is beginning to transact more business in areas such as Eastern Europe, but that number is expected to hit 200 in the near future and at present "they just don't fit too well in the Belgian pension fund".

The new International Pension Fund KBC is expected to be operational by the beginning of 2009, and will initially only focus on expatriates because it will be run as a separate scheme to the existing pension fund, yet there is the possibility it may become a pan-European pension fund.

Meysmans said if it goes well KBC may look to extend its coverage to "pension schemes set up by KBC branches in Central Europe, thus becoming a pan-European pension fund" though emphasising this is unlikely to happen until at least sometime between 2010 and 2012.

Since the introduction of the OFP regime - Belgium's interpretation of the EU Institutions for Occupational retirement Provision (IORPS) directive - in 2006 the country has been promoting itself as the ideal base for multinational companies seeking to establish a cross-border scheme, and led to the creation of a government marketing brochure entitled Belgium: prime location for pan-European pension funds.

To date, however, no large multinational company has agreed to set up a pan-European pension scheme.

Nestlé confirmed in April it planned to launch a pan-European pension fund in Belgium, but said "no major steps" would be taken in the rest of 2008. (See earlier IPE article: Nestlé goes pan-European step-by-step)
 
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